It's no day at the
operating a giant, successful, multinational American company, once
you've run up against some very un-American notions about tax
policy from abroad. Such as the "data tax" on
), about to be proposed by France for adoption by the European
Apparently, France would like to impose a data transmission tax on
those companies -- and only those companies -- because they are the
dominant platforms for Internet usage in Europe just as they are in
the US, but they are "non-European," that is, American. Their
dominance therefore prevents European competitors from emerging
from obscurity. (How taxing the most popular sites will make other
sites more popular with consumers is not clear.)
A French member of the European Parliament
Wall Street Journal
that a data tax should be imposed because the European nations have
become "just the puppets of financiers and multinationals."
Or, as Forbes puts it in
a now-classic headline
: "Gibbering Nonsense From France About Apple, Google, Facebook and
The tax plan is just one piece of a proposal that would establish a
new Internet regulatory agency within the European Union. In part,
the agency would be empowered to impose other rules aimed at
leveling the playing field for European competitors, such as
forcing the American companies to enable portability among devices
for digital purchases.
French Technology Minister Fleur Pellerin told the
Wall Street Journal
that the absence of such regulations is effectively "blocking
innovation from all of the other actors," and making it difficult
for European companies to emerge.
The call for regulation gets real impetus from another issue that
has entangled US technology companies in Europe: data privacy. The
issue gained a great deal of heat after revelations of the US
government's continuing collection of private data on a massive
scale, and with the cooperation of some of its biggest technology
The proposals are expected to be presented in late October at a
summit of European leaders.
At this point, the data transmission tax is the part of the
proposal that seems least likely to succeed.
For one thing, it's not clear how such a usage-based tax could be
imposed, though Pellerin
that her agency is looking at data transfer, traffic, and
interconnection to work out how the big Internet companies make
their money and, therefore, what part of their (free) services
could be taxed.
In addition, it appears that
Great Britain will oppose
the idea, according to the British newspaper
, not least because the European Union does not currently have the
power to levy taxes.
The proposal appears to have the support of European telecoms,
which have long resented the low tax rates enjoyed by American
companies that are, after all, using the physical networks the
In an opinion piece for the
, British technology executive Joanna Shields argued that
regulating the Internet would inevitably harm European startups as
much as American businesses.
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